Academy Awards: How Much Money Does an Oscar Make?

It’s Oscar season again and while red carpets are being rolled out, we’re going to take

a look behind the curtain and see why the movie industry cares so much about these famous

gold statues.

Because the glitz and glamour is just the face of the business, behind that, it’s

about the money, just like every other industry.

The Academy Awards is Hollywood's golden night, but it comes after many days and months of

spending green.

And all for a statue that costs around $400.

The first thing to look at is just how much of the movie industry is organised around

award season.

If you look at every film that’s been nominated for best picture this decade, only 8 out of

the 71 were released in the first half of the year.

And of those, only Get Out and The Grand Budapest Hotel were released before May.

This isn’t a new trend either, studios know that they need to aim for the end of the year

if they want an Oscar nod so expect them to plan their releases accordingly.

Every best picture winner this decade came out in October or November.

Historically, November is your best chance for a best picture winner and December is

your best chance for a nomination.

Obviously that isn’t just short term memory from the 7000 academy members but since everyone

is more likely to remember a recent film, studios just started timing their releases

so all their Oscar hopefuls come out at the same time.

If a major studio releases a film in February, you can be sure they think it has no hope

of an award.

So why do they care so much about an Oscar award, is it simply prestige or does it make

a difference at the box office?

It turns out that it matters, but only because studios have learnt exactly how to manage

Oscar nominations and wins, in order to give them the most impact on returns.

The nomination or win on its own wouldn’t have much effect if you just stayed on the

release schedule that you had.

You need to capitalise on the exposure by opening wider or, if the film is later in

its run, keeping it on the screens you already have.

Because the real benefit of an Oscar boost is not a huge jump in audiences the next weekend,

although there is some jump, for sure.

But really it’s about increasing the longevity.

The oscar nominations get a huge amount of coverage and many people who might not have

heard much about the movie, either by word of mouth or from the media, will now pay attention

to it.

A study by economist, Randy Nelson, in the early 90s, looked at movies from 1978 - 1987.

He found that an Oscar nomination tended to double the amount time the movie was in theatres,

compared to those that weren’t nominated.

This led to an average $12.7 million boost for the best picture winner and just under

$5 million for a nominee.

Blogger Edmund Helmer crunched some more recent numbers and said that the best picture winner

now gets $14 million and a best director gains $11 million.

These are big numbers.

They might be dwarfed by the Disney owned box office giants like Marvel and Star Wars

but you have to remember that a lot of dramas are made for a fraction of the cost of a blockbuster.

Last year’s best picture, Moonlight, had an estimated budget of $4 million.

There's a mistake.

Moonlight.

You guys won best picture.

This is not a joke.

I'm afraid they read the wrong thing.

This is not a joke.

Moonlight has won best picture.

Moonlight - best picture.

Moonlight made $16 million before it’s nomination, $6 million after the nom and over $5 million

after winning.

But that was well managed by studio A24.

Before the nomination it had played steadily at 650 theatres.

Once it got nominated, they went up to 1,104 and when it won, they played at 1,564 theaters.

It’s nothing complicated but studios have a lot of experience of getting this balance

right.

So even the average $5 million gained for a nomination, that’s profit.

It’s not pure profit of course.

The studios are able to plan these release schedules because they aren’t just waking

up one morning and staring in shock as they read their nomination in Variety, they are

already well into the award process by then.

Which brings up an interesting point, We’ve covered what an Oscar can gain, but how much

does it cost?

For the studios, there are 3 main aspects of Award season.

Phase 1 is anything before the Oscar nominations are announced on January 22nd.

They can spend what they want to make sure the 7000 academy members pay attention to

their film.

A front page advert in the Hollywood Reporter during award season can cost up to $72,000.

Studios send out packages with DVDs.

There are lavish buffets and screenings and parties.

There’s also a lot of award ceremonies like the Golden Globes and the British Baftas.

Then there is Phase 2.

After the nominations, there are strict rules in place so no one can be accused of “buying”

and Oscar.

This covers emails, free food and drinks, and having private events with the stars of

the movie.

Marketing firms are used to boost a film, and no doubt leak a few smear stories on the

competition, such as when rumours appeared that Slumdog Millionaire was exploiting child

actors.

The big stars are sent to meet and greet as much as possible and it’s in their interest

too, a best actor or actress award might not make much difference at the box office but

it will improve the performer's next paycheck.

There’s still a big gap for actors and actresses though, with men gaining up to $4 million,

while for women it’s just $500,000

The third aspect is guild awards.

These don’t get a lot of press but since the academy members are well connected in

the industry, these insider awards carry a lot of weight and can help build momentum

behind a film.

Studios spend big to get Oscars.

Newspaper ad of $72,000 and then there's all these DVD screeners they send out to award

voters and those cost in total about $250,000 for each film and on top of that each movie

needs an Oscar consultant.

Yup, that's a thing, Oscar consultant.

In all, a studio could spend $10 million on promoting a movie for the oscars.

But this will only be if the movie is in the right place on it’s theatre run, so it could

make the most of any win.

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